Exam 8: Cost Estimation and Budgeting

What is the total amount budgeted for design costs in this time-phased budget? Activity January February March April Survey 8,000 Design 5,250 4,500 Dirt 6,700 Foundation 12,550 Framing 37,250 Plumb 7,800 Wire 5,500

There is a tendency for different departments or functions to compete for scarce resources in a zero-sum game when bottom-up budgeting is used to develop a project budget.

There was no way that the study tour to Italy could cost only $1500 for 14 days and 13 nights and include all transportation,meals and hotels,but the smarmy professor knew that students would balk at a higher advertised price.Once they were thousands of miles away from home in a country where none of them spoke the language it would be easier to tell them about unanticipated charges and approach the more realistic price of $3500 per person.This type of:

An activity with a learning rate of 0.8 takes 30 hours for the first six units.How long will it take to complete this task for the 12th time?

Which of the following is a direct cost?

A disadvantage of contingency funds is:

Effective comparative estimates rely most heavily on:

If it takes 40 hours to complete the first unit and the company knows from experience that the learning rate should be 0.75,how fast can they be expected to finish all ten units?

The new bridge would require 14 piers to support it and it was known that each time a pier is sunk into the harbor it would take 30 man hours of labor at $50 per hour.An activity-based costing of the entire pier system results in a total labor cost of:

The new artisanal greenhouse would require 700 empty wine bottles be embedded in a frame made of clay and straw.The builder,a man with too much time on his hands,had determined that each time a bottle was added to the structure it would take 30 minutes of labor at $7.50 per hour in the blazing sun.An activity-based costing of the entire artisanal greenhouse revealed that the total labor cost would be:

A budget containing disaggregated figures across the schedule when work is planned is a:

An expedited cost is one that does not vary with respect to their usage.

The charge that is most likely a fixed cost is for:

An allocation of extra funds to cover uncertainties and improve chances that the project can be completed within the timeframe originally specified is a:

Material is an example of a cost that is recurring,variable and direct.

The order of magnitude cost estimate is used when:

Provide examples and discuss the differences between direct and indirect costs.

A learning rate of 90% means that for every doubling of output,the time required by the activity falls by 10%.

A contingency rate of 10% on a building project budgeted at $20 million means the project organization is hoping to bring the project in for around:

A time-phased budget allocates costs across both project activities and the anticipated time in which the budget is to be expended.